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EMCOR Group, Inc. (NYSE:EME)
Beneish M-Score
-2.36 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

EMCOR Group, Inc. has a M-score of -2.36 suggests that the company is not a manipulator.

EME' s 10-Year Beneish M-Score Range
Min: -3.12   Max: -1.71
Current: -2.36

-3.12
-1.71

During the past 13 years, the highest Beneish M-Score of EMCOR Group, Inc. was -1.71. The lowest was -3.12. And the median was -2.47.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of EMCOR Group, Inc. for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.0265+0.528 * 1.0028+0.404 * 1.3385+0.892 * 1.0111+0.115 * 0.9724
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0509+4.679 * -0.0076-0.327 * 1.0112
=-2.36

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $1,268 Mil.
Revenue was 1662.937 + 1629.067 + 1556.753 + 1568.401 = $6,417 Mil.
Gross Profit was 234.075 + 206.31 + 181.535 + 191.138 = $813 Mil.
Total Current Assets was $1,930 Mil.
Total Assets was $3,466 Mil.
Property, Plant and Equipment(Net PPE) was $123 Mil.
Depreciation, Depletion and Amortization(DDA) was $67 Mil.
Selling, General & Admin. Expense(SGA) was $591 Mil.
Total Current Liabilities was $1,299 Mil.
Long-Term Debt was $335 Mil.
Net Income was 45.921 + 26.69 + 21.014 + 30.167 = $124 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 82.022 + 120.258 + 42.891 + -95.102 = $150 Mil.
Accounts Receivable was $1,222 Mil.
Revenue was 1611.881 + 1606.242 + 1590.035 + 1538.521 = $6,347 Mil.
Gross Profit was 228.449 + 203.248 + 193.964 + 180.693 = $806 Mil.
Total Current Assets was $2,044 Mil.
Total Assets was $3,107 Mil.
Property, Plant and Equipment(Net PPE) was $117 Mil.
Depreciation, Depletion and Amortization(DDA) was $61 Mil.
Selling, General & Admin. Expense(SGA) was $556 Mil.
Total Current Liabilities was $1,295 Mil.
Long-Term Debt was $154 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1268.226 / 6417.158) / (1221.956 / 6346.679)
=0.19763048 / 0.19253471
=1.0265

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(206.31 / 6346.679) / (234.075 / 6417.158)
=0.12705133 / 0.12670064
=1.0028

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (1930.105 + 123.414) / 3465.915) / (1 - (2044.453 + 116.631) / 3107.07)
=0.40751028 / 0.3044624
=1.3385

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=6417.158 / 6346.679
=1.0111

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(60.966 / (60.966 + 116.631)) / (67.338 / (67.338 + 123.414))
=0.34328283 / 0.35301334
=0.9724

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(591.063 / 6417.158) / (556.242 / 6346.679)
=0.09210666 / 0.087643
=1.0509

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((335.331 + 1298.743) / 3465.915) / ((154.112 + 1294.519) / 3107.07)
=0.47146973 / 0.466237
=1.0112

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(123.792 - 0 - 150.069) / 3465.915
=-0.0076

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

EMCOR Group, Inc. has a M-score of -2.36 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

EMCOR Group, Inc. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.00020.95891.01330.98090.76890.92951.27540.95490.82971.0265
GMI 1.12510.89280.93730.95040.90740.87891.04021.09321.02911.0028
AQI 0.97591.04250.92891.65481.02541.00780.81451.29890.94051.3385
SGI 1.04390.97761.06721.20921.14480.81760.87461.15691.13061.0111
DEPI 0.89710.92051.13910.92870.92711.00631.03380.92821.00780.9724
SGAI 0.87791.05731.00650.94691.0121.14030.99430.94850.94951.0509
LVGI 0.97470.91920.98411.04630.93111.04370.85310.98050.94681.0112
TATA -0.0083-0.0442-0.0601-0.0814-0.0504-0.0665-0.0596-0.0062-0.0122-0.0076
M-score -2.41-2.78-2.73-2.47-2.83-3.12-2.62-2.23-2.56-2.36

EMCOR Group, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.01510.98570.91630.85080.9630.82971.06091.13511.07941.0265
GMI 1.07021.09091.08341.08171.05471.02911.00511.00010.99891.0028
AQI 1.35931.29891.26020.94890.92560.94050.94370.92661.29551.3385
SGI 1.06511.12071.1631.19371.15871.13061.08321.0351.01811.0111
DEPI 0.95340.92820.97750.91851.00321.00780.96810.98851.00070.9724
SGAI 0.94310.95120.97080.96140.95850.94950.96010.98421.02261.0509
LVGI 0.96110.98050.96760.95570.98030.94680.93620.96771.03041.0112
TATA -0.0082-0.0062-0.00610.00180.001-0.01220.009-0.0018-0.0243-0.0076
M-score -2.25-2.24-2.28-2.40-2.36-2.56-2.30-2.35-2.40-2.36
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